The Five Lessons a Millionaire Taught Me About Life and Wealth

Richard Paul Evans

• Publisher: Touchstone
• Year: 2006
• ISBN:
  9780743295895
• Topic: Personal Development
• Subtopic: Personal Success

Easy to understand and simple to apply, The Five Lessons a Millionaire Taught Me About Life and Wealth is one of the most powerful books ever written about money. This book will change your life. When Richard Paul Evans was twelve, his father, a building contractor, shattered both his legs. With no insurance, no income, and eight children, the family was destitute. At that difficult time young Evans was introduced to a kind multimillionaire who taught him the five secrets of wealth. Today, Evans credits those lessons not just with bringing him wealth and success but with bringing him freedom and opportunity in a world where financial slavery is ubiquitous. In his signature motivational voice, Evans interweaves those influential lessons with personal stories from everyday people. He explains that money should not be the preoccupation of our lives. Rather, if we follow the five principles, we will be free to focus on God, family, and relationships—the true nourishments of life. Wise and compelling, The Five Lessons a Millionaire Taught Me About Life and Wealth can be read in a single sitting and will leave you with a new view of what it means to be rich—and convinced that you, too, can build wealth. The Five Lessons a Millionaire Taught Me About Life and Wealth is endorsed by financial consultants, churches, schools, and marriage counselors. You cannot afford to be without this book.

Lesson Four

Win in the Margins

Fortune befriends the bold.

—VIRGIL, The Aeneid, TRANSLATED
BY JOHN DRYDEN

Of all the lessons, Lesson Four has the most to do with the speed of my own financial success. What does it mean to win in the margins? Simply this: The wealthy find additional ways to increase contributions to their growing nest egg.

J. Paul Getty, once named the richest man in the world by Fortune magazine, called this “the Millionaire Mentality”:

“The Millionaire Mentality watches costs and tries to reduce them—and strives to increase production and sales and thus profits.”

Though Getty was speaking specifically about business, the principles are true in all areas of finance. There are essentially two ways to win in the margins. The first is by earning extra income. The second is by keeping more of what you earn. I recommend that you do both.

Winning in the Margins with Extra Income

I once had a friend who had the peculiar habit of looking for money. He would actually walk or ride his bike while looking down. As odd as his behavior was, the most surprising result of his habit was that nearly every day he would find something. We would be walking along when suddenly he’d stop, bend over, and lift a coin or bill from the ground. I’m not recommending that you start walking looking down. My point in sharing this story is to demonstrate that you find what you are looking for. When you start looking for ways to increase your income, you will discover that there are opportunities all around you that you have never thought of or noticed. The following examples illustrate this principle.

Coffee Cans of Gold

My wife’s grandfather, Pietro Disera, emigrated from Italy to America when he was only seventeen. He came west looking for work and found employment in the gold and silver mines of the Tintic mining area west of the Salt Lake Valley. He worked the night shift at the furnaces where the processed ore was smelted in order to separate the gold from the other metals before being poured into bullion. Pietro noticed that the gold would occasionally explode, splashing the metal inside on the hood of the small furnace. He asked his foreman if he could keep the metal he found if he stayed after his shift and cleaned the hood on his own time. The foreman agreed.

At the end of each shift, Pietro would climb into the furnace and scrape the thin gold flakes from the metal hood into an empty coffee can. Within months, the poor immigrant boy had collected two coffee cans filled to the brim with the precious metal—nearly twenty pounds of gold.

Scrap Wood

Clinton Phelps grew up in the wooded mountains of southern Oregon. To provide for his family, he drove a truck, hauling lumber from a nearby lumber mill. While waiting for his truck to be loaded, he often heard the mill workers complain about the mill’s waste products. After the usable wood was cut into boards, the remaining slabs were thrown on a conveyor belt and transported to an incinerator to be burned. Much of the wood was too green to burn well, and the mill workers had trouble keeping up with the waste. In addition, the smoke from the incinerator had the townspeople and environmentalists constantly up in arms.

One day, Clinton had an idea. He asked the mill owners if they would allow him to take the wood, offering to cut it up and haul it away at no charge to them. Glad to be free of the problem, they accepted his offer—even agreeing to pay for the electricity he needed to cut the wood. Before long, he was hauling out nearly one hundred cords of firewood every day, which he sold in a nearby town.

He may have been just a truck driver with an eighth-grade education, but with a simple idea he had increased his salary by more than a hundred thousand dollars a year. And the land he bought years ago to store the wood is now worth millions.

Renting Farmland

Warren Buffett, the sagacious multibillionaire, learned the lesson of winning in the margins early in life. At the age of just fourteen he bought forty acres of Nebraska farmland with money he made on his paper route and then rented the land. He also invested in soda pop and pinball machines and used his profits to make his first investment partnership. The rest, as they say, is history.

Xango Juice

As a young man, Lance Schiffman had the opportunity to visit with a Chinese billionaire. In the man’s home were original Picassos, Ming vases, and priceless tapestries. Making the most of the opportunity, Lance asked the billionaire how to get rich. The man’s advice was simple. “Work the day job,” he said. “Get insurance and benefits and stability for your family. You owe them that. But always be looking for the side way to earn. That’s where you’ll find wealth.”

In other words, win in the margins.

Lance followed his advice. While he was working nights and graveyard shifts for an airline “winging luggage,” as he called it, he tried as many side projects as he could. He owned a triplex, a fast-food restaurant, a gas station, and a florist shop. Some of his ventures were profitable, others not. But with each investment, he got better at making money.

One day a friend introduced him to a health product called XanGo: a supplement made from the mangosteen fruit. XanGo was searching for people to share the product. Lance looked into it and liked what he saw. He immediately signed up and began introducing the product to neighbors and friends. Before long, he signed them up as distributors. They, in turn, signed up others. Within two years he had more than thirty thousand distributors and was earning well over half a million dollars a year. Lance has now helped thousands of others win in the margins.

A Christmas Gift

The most money I’ve made in my lifetime was on a side project. It wasn’t my first such venture. It was my fourteenth.

For me the habit of winning in the margin started when I was young. At the age of twenty, I was working for low wages cleaning up construction sites. Such menial labor gave me ample time to think, though admittedly most of what I thought about was how I could find another job and quit cleaning construction sites.

As I thought over my situation, I realized that there were no vending machines on the job site and that every few hours the construction workers would send someone to a nearby convenience store for soda pop. I saw an opportunity.

That night, on the way home from work, I bought an inexpensive cooler at a secondhand store, then purchased soda pop and candy bars in gross from a nearby price club. The next day I took my cooler to work, selling my products at a dollar each. I doubled my income, making as much on the treats as I did pushing a broom. I eventually accomplished my goal and moved on to another job, but I never stopped trying to win in the margins.

My big hit came ten years later when I decided to self-publish a book I had written as a Christmas present for my daughters. I hadn’t intended to publish the book, but after receiving many requests for copies, I decided to print a few. The first year that little book netted me twenty thousand dollars. I reinvested my earnings, and the second year I earned more than four hundred thousand dollars. The third year I earned nearly $4.5 million. That’s when I quit my day job.

You could say that I—and the others I’ve written about here—were just lucky. Of course we were. But as George S. Clason wrote, “Opportunity is a haughty Goddess who wastes not her time with the unprepared.”

Was it luck that caused me and my colleagues to try again and again to find ways to succeed financially? Was it luck that I noticed a trend with my book? Was it luck that I consulted all the experts I could find about making my book a success? Was it luck that I took copious notes on each marketing venture I tried, evaluating its success and failures? The bottom line is (and you should underline this): I would never have been lucky had I not been looking for ways to increase my earning ability.

For free ideas on how to win in the margins, visit my Web site today at www.wininthemargins.com and enter win when asked for your passkey.

Double Your Wealth

While those in the previous examples all hit it big, even earning just a percentage of your regular income each month goes a long way toward building your wealth. As indicated by the table showing compound interest in Lesson Three, if you’re earning an average (household) income and are saving 10 percent, you are putting away about $468 a month. If you increase your income by an extra $468 a month and apply it to your nest egg, it is, in the long-term accumulation of wealth, the equivalent of doubling your income.

WEALTH ACCUMULATION AT 10 PERCENT:

Year(s)		Savings
1 Year		$5,158
5 Years		$31,615
10 Years		$82,996
15 Years		$166,501
20 Years		$302,214
30 Years		$881,230
40 Years		$2,410,579

WEALTH ACCUMULATION AFTER DOUBLING YOUR NEST EGG CONTRIBUTION:

Year(s)		Savings
1 Year		$10,316
5 Years		$63,230
10 Years		$165,993
15 Years		$333,002
20 Years		$604,427
30 Years		$1,762,459
40 Years		$4,821,157

By increasing your nest egg contribution through earning or saving an additional 10 percent each month, the average household will achieve millionaire status more than seven years earlier. Clearly the path of extra income is worth pursuing. But where do you find the extra income?

As demonstrated by my friend who walked with his head down looking for money, it’...

Table of contents

• Cover
• Praise
• Colophon
• Title Page
• Copyright
• Dedication
• Message
• Contents
• Foreword by Robert C. Gay
• Preface Why I Wrote This Book
• Introduction The Teacher
• Lesson One Decide to Be Wealthy
• Lesson Two Take Responsibility for Your Money
• Lesson Three Keep a Portion of Everything You Earn
• Lesson Four Win in the Margins
• Lesson Five Give Back
• Conclusion Is It Ever Too Late to Start?
• Resources
• THE FIVE LESSONSNET WORTH SHEETAS OF
• About the Author